New loan scheme launched to help SC/ST entrepreneurs

HOSHIARPUR, December 28

With an aim of supporting SC/ST entrepreneurs of the country, the Small Industries Development Bank of India (SIDBI) launched a new financial scheme ‘Saath’ at Hoshiarpur on Wednesday.

PM Narendra Modi-led Central government has asked banks to come up with loan schemes for SC/ST people. Considering my request, SIDBI came forward with one such initiative for SC/ST people to help flourish their businesses. Vijay Sampla, NCSC Chairman

The scheme was launched by National Commission for Scheduled Castes (NCSC) chairman Vijay Sampla and SIDBI chairman-cum-managing director Sivasubramanian Ramann. During the event, the loan sanction letters were also issued to the beneficiaries of the scheme.

“PM Narendra Modi-led Central government has asked banks to come up with loan schemes for SC/ST people. Considering my request, SIDBI came forward with one such initiative for SC/ST people to flourish their businesses. The ‘Saath’ scheme has minimal processing fee whereas people can repay the loan amount in seven years, which is often five years in other banks’ schemes,” NCSC chairman Vijay Sampla said.

He added though the SC entrepreneurs from across the country could avail the benefit of the scheme, I am thankful to the SIDBI for considering my request of keeping the special focus on assisting the MSMEs based in Hoshiarpur (Hoshiarpur District) and Phagwara (Kapurthala District).

“Besides ‘Saath’, the bank also has another scheme, Paryas’, in which the bank provides small loans to the SC/ST people to start or expand their businesses,” Sampla added.

While speaking on the occasion, Sivasubramanian Ramann, said, “The businesses of many people got affected in Covid pandemic and with the ‘Saath’ scheme, people can again think of expanding their industries. Under the scheme, SC/ST entrepreneurs can avail the benefit of term loan assistance (on relatively easy terms) for the establishment of new or greenfield units or for expanding and modernising the existing units, coupled with incentive structure. The term loan assistance will be provided to such units for acquisition of land, construction of factory or office building, equipment, plant and machinery and other fixed asserts.”

Each borrower can take the loan from Rs 25 lakh up to Rs 3 crore, while they will have to repay the amount within 7 years (including the moratorium period of upto 2 years).

Ramann further explained that the entrepreneur should contribute a minimum of 20% of the project cost in the existing unit whereas those making new units will have to contribute a minimum of 25% of the project cost.

SC/ST entrepreneurs who are eligible but are not in a position to provide collateral security will get credit guarantee coverage under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGMTSE). Not only so but the 50% cost of the processing fee for the CGMTSE guarantee will be borne by the SIDBI.